The aim of this chapter is to develop an institutional framework for analyzing and improving sustainability. More specifically we discuss (i) developing a framework that consists of different institutional levels and a set of indicators for measuring the relevant features of each institutional level; (ii) investigating what are the dimensions of sustainable agriculture and rural development and related suitable indicators; (iii) the relationship between the institutional framework and sustainability; finally (iv) we tried to design better institutions for improving the sustainability in agriculture and rural areas. The chapter also underlines the relevance of looking at sustainability in a more empirical way. It strongly emphasises the necessity to support the theoretical approach with the use of indicators and reference levels. More specifically, the chapter indicates general and more comprehensive typologies of indicators that are commonly used to evaluate sustainability and sustainable development in agriculture and rural areas